Maintain long positions. The FCPO closed the latest trading MYR8 lower at MYR2,132, this was after it reached a low and high of MYR2,122 and MYR2,149. Still, we are seeing the recent sessions’ weakness as part of a consolidation phase (in the form of a retracement) after the commodity rebounded relatively sharply from the low of MYR2,038, recorded on 15 Mar. Towards the upside, once this consolidation phase is finished, we expect the 200-day SMA line to be tested. Maintain our positive trading bias.

As we continue to see the commodity’s recent weakness as just a consolidation phase, instead of a resumption of a weak price trend, we continue to recommend that traders stay in long positions. These were initiated at MYR2,164, which was the closing level of 21 Mar. A stop-loss can be placed at below MYR2,038.

The immediate support is expected at MYR2,038, the low of 15 Mar. The following support may emerge at MYR1,940, the low of 27 Nov 2018. Moving up, the immediate resistance is expected at MYR2,217, the high of 4 Feb and near the 200-day SMA. This is followed by MYR2,278, which was the high of 25 Feb.

Source: RHB Securities Research - 27 Mar 2019